With homes selling quickly and prices rising, some homeowners are tempted to try selling their home on their own as a For Sale by Owner (FSBO).
There are many reasons why 92%* of For Sale By Owners, who tried selling on their own, eventually give up and ultimately list their home for sale with a real estate professional REALTOR.
Here are five of those reasons:
1. There Are Too Many People to Negotiate With
Some of the people with whom you must be prepared to negotiate with directly if you decide to become a For Sale By Owner:
- The buyer who wants the best deal possible
- The buyer’s agent who solely represents the best interest of the buyer
- The buyer’s attorney (in some parts of the country)
- The home inspection companies, which work for the buyer, who will almost always find some problems with the house they may recommend additional inspections be done including: roof, HVAC, Termite, etc. before you negotiate repairs requested by the buyer to be done by the seller.
- The appraiser, if there is a question of value, rarely reverse their value. So be prepared.
2. Exposure to Prospective Purchasers
Recent studies have shown that 89% of buyers search online for a home. That is in comparison to only 20% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you have one?
3. Results Come from the Internet
Where do buyers find the home they actually purchased? Studies how:
- 44% on the internet
- 33% from a Real Estate Agent
- 9% from a yard sign
- 1% from newspaper
The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.
4. Becoming a FSBO has Become More and More Difficult
The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that a percentage of people who attempt to sell as a For Sale By Owner have dropped from 19% to 8% over the last 20+ years. Since NAR began collecting data in 1981, 8% is the lowest level of For Sale By Owner.
5. You Net More Money when Using an Agent
Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.
Studies have shown that the typical house sold by the homeowner sells for $210,000, while the typical house sold by an agent sells for $249,000. This doesn’t mean that an agent can get $39,000 more for your home, as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense when the typical FSBO sells their home at a 13-15% discount to the market.
Before you decide to take on the challenges of selling your house on your own, sit with a real estate professional in your marketplace and see what they have to offer.
If you are convinced you want to at least try selling your home yourself, come up with a good pricing, marketing and sales strategies to be successful—success follows knowledge, skill, hard work, a plan and dedication to the task at hand—not luck. Learn disclosure laws ever seller must be compliant, understand contract law, know the true value of your home—Zestimate doesn’t cut it—and be available to show your home when buyers want to see your home during the week and weekends, too.
Call Sam Elam today to discuss how he quickly nets you top dollar based on market value of your home with the least amount of hassle.
Associate Broker, ABR, CRS, GRI, e-PRO, SFR
Berkshire Hathaway HomeServices Arizona Properties
Cell: 480-213-1799 Email: SamElam3@msn.com
NOTE * According the NAR – the National Association of REALTORS